22 September 2009

United - Bundling Good, Unbundling Also Good

United Airlines seems to have caught the Ancillary Revenue craze quite heavily.

After offering one of the first enhanced seat products with its Economy Plus product - it then went on to offer Travel Options. Now it is offering a way to bundle certain products together into a package.

Now to some that might seem to be heresy. Essentially allowing a general punter to buy into the elite services as part of the dynamic price of the product. But for UA this might not actually be a bad thing.

Consider that UA is regarded as having one of the least "special" premium products - it is still workmanlike and functional. However the image has been less than attractive.

(Old planes -the last 737 goes into the sunset next month, varying degrees of color scheme etc etc).

So putting together a bundle that can be acquired easily at both the point of embarkation as well as (theoretically) the point of sale, makes this a good offer.

Given the now huge value of unbundled pricing - it makes sense to promote bundling as a way to boost that revenue

And what do you think?

Cheers

Timothy

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